Grazing (For Free Food) at Costco: A Frugal Way to Pass the Time

Yesterday afternoon me and two others commuted across Puget Sound to do a farewell dinner for somebody retiring from one of the detachments i'm in charge of. Commuting across Puget Sound, via ferry, always adds significant time to any trip. We left early and arrived at our destination a full one hour early. Needing to kill time, one person recommended we go to Costco. One of the three people in the car had a Costco membership. As a military service member, I get cheap food (without sales tax) at our military commissary. It's just me and my wife and we have little need for buying in bulk. I have heard that Costco has a great car buying service. I might join the next time I buy a new car. Other than that, I have no need for a Costco membership.

Once we got into the store, us guys spent an obligatory amount of time in front of the flat screen TVs. We walked amongst other sections of the store but ultimately ended up in the food section. I was a little hungry because it was about 430 pm and getting close to when I normally snack or eat dinner (after 5pm). I started coming across free food sample tables, sampling from each along the way. There must have been about ten free food sampling tables in that Costco! That's the most that i've seen at any store. I ended up sampling from most if not all of them. There were even a few sampling tables with a backed up cue of people waiting for the next batch of cooked/heated samples. Most of them had shopping baskets, but they obviously enjoyed taking the free samples like myself.

While sampling all of the free food, I thought about a term I heard previously called "grazing." Grazing aptly describes what I was doing.

I searched the internet but I couldn't find any entertaining videos on the subject. I suspect "grazing" could be an extreme frugal measure for some people to get calories. It could be frugal if you're already in the area of a store that puts out free samples and you decide to take a stroll through that store for free calories.

I suspect that it would be counterproductive to frugality if you have a large shopping basket with you. A number of people taking the free samples are already hungry and may be prone to impulse purchases of the sampled products. Speaking for myself, I know I would have bought at least one of the ten sampled products, joint juice, if I had a shopping cart with me. During my googling on the topic, I found that one of the highest grossing stores in the Giant Supermarket grocery chain actively employs the use of free samples and includes signage in front of the store encouraging "grazing."

I Just Turned Down Advertiser Money for a Text Link Ad (My New Screening Criteria)

As my website has grown, I have started to receive multiple requests to advertise on my site. This certainly helps my ego and wallet. However, I just decided to turn down my first ad placement. The reason for turning it down was because I was unable to confirm the identity of the advertiser with the Better Business Bureau, let alone the advertiser's record with BBB.

I lost out on about $120. I then noticed that some of my previously arranged ads are with companies registered with the BBB. Of those not registered, I intend to let their ads expire without renewal unless I later find that they have registered and have a good reputation with BBB.

The other techniques I have previously used is simply to do a google link search to determine which other bloggers already have advertising agreements with the new advertiser approaching me. You can do this by simply going to the google search field and typing "link:websiteaddress" You'll then get a listing of all sites that link back to the advertiser who has approached you. Of course, this isn't fool proof. It only identifies whether or not the advertiser is trusted by others.

I have noticed that a number of other personal finance blogs may not be applying the BBB criteria. Regardless, I think this is the best course of action going forward.

Does anybody else use other criteria for blogger - marketer arranged ad agreements?

CNBC Million Dollar Portfolio Challenge Daily Trivia Bonus Bucks Answers (1/23)

1/23 Bonus Questions:

(1.) Question: As of Jan. 19, how much bailout funding did HSBC request from the U.K. government?

Answer: no request being made

(2.) Question: On Dec. 14, we reported that Berkshire Hathaway raised its stake in Burlington Northern railroad to:

Answer: 20.47 %

(3.) Question: According to our slideshow, Behind the Scenes Look at the Death of Seth Tobias, where was "Tiger" the night in question?

Answer: Las Vegas

(4.) Question: In our slideshow, "Notable Sex Scandals," which disgraced figure is wearing a red pattern necktie?

Answer: Jim McGreevey

(5.) Question: In our "SPANX Million Dollar Girdles" slideshow, what archaic derogatory term is referenced?

Answer: “loose woman"

(6.) Question: According to our slideshow, Prostitution Scandals of the Rich & Famous, who revealed Sen. David Vitter's illicit secret?

Answer: Hustler magazine

(7.) Weekly Question: Jobless claims are reported

Answer: Weekly

Pledge 5 Volunteer Hours And Starbucks Will Give You a Tall Brewed Coffee

Starbucks will give you a 12 oz tall coffee from Jan 21-25, 2009, in participating U.S. Starbucks stores if you pledge to volunteer 5 hours of community service time. Offer not valid at airports or Barnes and Noble locations.

Additional details can be obtained at pledge5.startbucks.com or via your local participating Starbucks. If you don't have time to click through to the Starbucks site for further reading, simply go to your local Starbucks and say "i'm in" to get the free cup of coffee. The only obligation is following through on your committment to volunteer in your local community.

The FULL SPEECH of Barack Obama on Inauguration Day 2009

Here's the full Barack Obama Inauguration Day 2009 Speech

Part I



Part II

Credit Card Losses at Citibank Expected to Peak in Mid 2010 (Plus Other Personally Related Commentary)

Economics is one of my favorite subjects. This morning on CNBC a host conveyed that Citibank is projecting that its credit card losses will peak in mid 2010. The key determinant for credit card losses is the unemployment rate. I suspect that there is some lag between peak unemployment and credit card losses since:

a.) Credit card billing cycles have a natural one month lag between accrual of debt and debt repayment.
b.) Accumulation of debt on credit card requires a 4% of balance due repayment. Unemployed personnel should be able to make minimum payments for 3-6 months while they collect state unemployment payments.
c.) If unemployment payments are not enough to sustain a household, some unemployed personnel have "emergency" funds that may sustain them until the end of unemployment payments.
d.) I wouldn't consider 30 days delinquent as a loss for credit cards. I suspect credit card payments would need to be at least 90 days delinquent, perhaps 120 days delinquent before factored in with peak credit card losses at Citibank. Let's stick with 90 day delinquent assumption.

Doing some back of the envelope math:

June 2010 minus "a" = May 2010
May 2010 minus "b" = Dec 2009 to Feb 2010
Dec 2009 to Feb 2010 minus "c" = Dec 2009 (firm, vice date range)
Dec 2009 minus "d" = Sep 2009

Using Citibank's statement for peak credit card losses, one may extrapolate a peak unemployment rate around Sep 2009. Now factoring in the U.S. agricultural growing season marked by last freeze in May and first freeze in October, one may infer that agricultural jobs will provide some employment strength up till October. Readjusting for this seasonal sector of our economy, I believe that U.S. peak unemployment could be around Oct 2009, assuming Citibank's projections are valid. The extent of Citibank's credibility in forecasting profits / losses is debatable, especially with their deplorable projections related to mortgage backed securities leading up to the real estate bubble.

The whole travel industry may get some of the traditional summer travel but should bank on significantly lower consumer travel in Thanksgiving and Christmas periods. Retailers will feel the biggest pinch during the next Black Friday and Cyber Monday in Nov 2009. Thus, I would stay away from investments in sectors involving discretionary income until at least 2010.

Yes, the Obama administration will likely provide significant economic stimulus. Even with this, American citizens will have grown to understand the impact of tough economic times. They will also realize that today's negative three percent household savings rate (an approximation) needs to be readjusted to the ten percent plus savings rates of the early eighties. This readjusted savings rate will offset much of the gains some people expect out of the upcoming Obama stimulus package. Even with the stimulus package, the financial sector has a number of emergency / TARP loans from the U.S. government. It will take these companies about 5 years (this is a SWAG) to either payoff these debts, or make significant progress allowing them to long-term refinance the debt. This 5 year period of time represents a period where there is less money available for lending. Those who qualify will naturally be those cases that have high FICO scores and present minimal risk to banks.

My best investments for 2009:
- Stocks: Bear Market mutual fund (BEARX). If you insist on going long on stocks, consider utilities, consumer staples and health care.
- Cash: Paying off mortgage early or saving to buy a house

Glenn Beck Returns to TV Next Week

Glenn Beck returns to TV next week (Monday 1/19) on Fox News. His time slot will be 5pm EST. His new show is simply called "Beck."

Freudian Slip: President Bush Just Called Our Current Economic Situation a Depression

During President Bush's final press conference, he referred to our current economic situation as a Depression.

I believe it may have been a Freudian slip because in his same sentence he also mentioned the Great Depression.

The context was in reference to what his economic advisers were telling him about the present day economic situation and his tax cuts. President Bush was emphasizing how important his tax cuts were during his administration; that the people are the best people to spend their own money as compared with the government. In particular, during our present Depression.

Sorry. I don't have the exact quote, I wasn't expecting to hear it, but know that I did hear it.

Just Received Mixed News on One of My Rental Properties, Predominately Good Though

Our largest rental property is 3100 square feet. It was previously our primary residence until June of this year. We did get a renter to assume the property on June 1st but they promptly notified us that they were going to break the lease just 5 months later.

=(

I'm trying to collect two months of rent as a penalty for breaking the lease. Unfortunately, they only paid for one. The outgoing tenants cut the power off to the house and even left food in the fridge.

Fortunately, we just found some new tenants who are willing to move in on the first of February, or as soon as we can get the current tenants fully out of the house.

I'm sure a little drama may go down over the next couple of weeks as we jockey for the new tenants to move in. However, in the long run, it looks like the new renters will be a great.

My last major concern on our rental properties is some delayed maintenance at the first house I bought. My property manager is working to get some estimates. Work will likely exceed $10k. Once this is finalized, we'll be able to get back on track with our accelerated payments on our rental properties. So long as the maintenance doesn't amount to anything substantially greater than $10k, we should be able to pay off one of our three houses within the next 15 months.

Small (Frugal) Household Investments With Major Returns

I came across a good article at Yahoo which details a number of things you can do around the house to save money. While there is an initial outlay of cash for each of these household investments, the return on that investment can be substantial.

$55 Bread maker. If you spend $4 a week on store bought bread, then you can save about $208 a year.

Credit Cards. Get a credit card with a sign up bonus. Then cancel the credit card after receiving the sign up bonus.

Libraries. Quit buying books and magazines and go to the library, if nearby. So long as your commute is short the return on investment can be infinite.

Cable. Replace your cable with a Netflix service. If you already getting the major networks then you might be able to tolerate losing the premium networks and still achieve an estimated 98% return on your investment (ROI) in Netflix

Herbs. Order a few bags of seeds and start growing herbs on your Apt balcony or in your back yard. We already do this at our own apartment. The Yahoo article alludes to an estimated 400% ROI.

Cell phone. Switch to a pre-paid cell phone and augment it with internet phone calls at home. Estimated ROI 500%.

Coffee. Start making your own coffee and save up to an estimated $1000 a year which could be a 1000% ROI.

Here's the full article by Brett Arends of the WSJ.

Download Suze Orman's 2009 Action Plan Book For FREE on January 8th

Suze Orman has a new book out called "Suze Orman's 2009 Action Plan." The book sells for $9.99 at Amazon.com.

This morning she announced on CNBC that she will be on Oprah on January 8th and that viewers of that specific program will be able to download her new book for free.

2008 Happy Honda Days Instant Win Contest (Win $100 Gift Card While Honda Donates Up To $100k To Charity)

I stumbled across this $100 gift card contest while browsing Hondas online. I found this contest by clicking through a banner ad at Motortrend.com. Clicking through the banner ad gets you to the following destination site. Looking at the middle left of the page you can see the "instant win" tab. Clicking on this tab will bring you to the contest entry page (here).

Summary of contest:
* Up to 5 entries
* Contest open to entry through 5 January.
* Contest entrant has chance to win $100 gift card
* Honda will donate $1 per contest registrant up to $100k divided across three charities. Each contest registrant plays a role in determining what charities receive.
* Charities are:
- Keep America Beautiful® - Road to a Cleaner America
- Little League Baseball® - Urban Initiative
- Pediatric Brain Tumor Foundation

I stumbled upon this contest because i'm constantly reading about new cars. I'll likely buy a new car within the next 1-3 years to replace my '98 Acura CL with 135k miles.

Ten Mortgage Tips I Learned From Past Three Home Purchases

Bottom Line: I highlight some of my personal lessons learned from three home purchases conducted over the past six years.

1. Read “106 Mortgage Secrets All Home Buyers Must Lean – But Lenders Don’t Tell” by Gary Eldred, PhD. First third of book is dedicated to people that need help with credit or qualifying for expensive housing. Remainder is chocked full of level headed comments (AS APPOSED TO THE OTHER BOOKS ABOUT BECOMING A MILLIONAIRE WITH NO MONEY DOWN). The 106 secrets are summarized in the table-of-contents for a quick initial review.

2. Bad U.S. economy news is good news for you when you’re floating your rate (inverse relationship). For example: a high unemployment rate should help you get lower mortgage interest rates. Be mindful of economic news scheduled for release the week or two prior to your intended lock date and pay attention.

3. If you’re buying below fair value, a low appraisal may keep property taxes down but it’ll also make it more difficult for you to shed Private Mortgage Insurance (PMI) later because it’ll take longer to develop an 80 percent loan to value ratio. Generally, it’s best to get a full service appraisal because you have the best chance for the appraisal to come back over your purchase price.

4. If you don’t put 20% down at closing, you generally won’t be able to shed PMI for at least the first 12 months. After 12 months, you’ll generally either have to order a full service appraisal showing that the house is now worth 20% higher than the current loan balance… or you’ll have to refinance. Make sure it’s clear what your mortgage company requires for removal of PMI.

5. Generally, you’ll find that your PMI rate will depend on your FICO score, type of loan and down payment (LTV ratio). Generally PMI monthly premiums reduce with every 5% you put down.

6. If you’re in a situation where it's not likely for you to build 20% equity quickly (to get rid of PMI), consider rates for an 80/20, 80/10/10, 95/5/5 loan (LOAN/Piggy Back Loan/Down Payment). If you can’t get a good rate for one of these loan combinations, ask your loan officer if you can pay your full PMI premium up front. This will allow you to roll the premium over to your home loan and deduct both your home loan interest and a portion of your PMI premium if you itemize taxes.

7. There is generally no difference in the rate you’ll get quoted between 10 yr and 15 yr fixed loans. A 20 yr fixed doesn’t significantly improve you quoted rate (when compared to a 30 yr fixed).

8. Closings via mail: Try and make sure the closing attorney’s office gets the package from your mortgage company no less than 5 business days prior to closing. This allows them enough time to reforward you the paperwork and still allows additional time on your end.

9. Settlement Statement:
a) If doing non-local purchase via mail: Wire fees are usually valid. Remember, closing attorneys are charged wire fees on each incoming wire transfer. It sucks that you have to pay a wire fee on your end and have to cover their expenses associated with receiving your wire and the mortgage company wire transfers.
b) Title insurance premium, refer to article wrote up below on subject

10. Closed on last house (24 Feb 06) with Pentagon Federal Credit Union. There loan officers are paid by the hour (not commission). They offer great rates and do 90 DAY LOCKS for no additional fee. They also pay a good portion of your buyer closing costs. Credit Union membership is open to everybody. I paid a $20 lifetime membership fee and did all paperwork via internet, phone and mail. Locked 15yr fixed at 5.0% (1 point, 20% down paid). Be aware, that some of the rates quoted on their site require 20% down.

45 Frugal Yet Romantic Ideas For You and Your Mate

First off, this post is not directly related to finance. However, it can be useful to you financially, especially if you want a few frugal yet romantic ideas, or you simply want to stimulate an existing relationship/marriage.

Ideas are taken from a brochure that I kept from my early college years titled “101 Ways to Eroticize Safer Sex.” The brochure was handed out by my Alma Mater’s peer health advocates group.

56 of the 101 ways to eroticize safer sex were excluded because they were either specific to the area of the University or not as tame/clean as what I’d like to post on this blog. Listed, in no particular order:

(1) Dance together in your room
(2) Go horseback riding
(3) Comb each other’s hair
(4) Play Frisbee
(5) Give flowers for no specific reason
(6) Take a hot air balloon ride
(7) Go to a music festival
(8) Hang out at a bookstore or music store
(9) Play board games
(10) Kiss each other slowly
(11) Take a sauna together
(12) Wear each other’s boxers
(13) Build sand castles
(14) Finger paint each other
(15) Take a nap together
(16) Give Eskimo or butterfly kisses
(17) Go hiking together
(18) Play wrestle
(19) Share a lollipop
(20) Give each other a foot and hand massage
(21) Listen to each other’s heart beat
(22) Watch the sun rise/sunset
(23) Leave a rose on your mate’s windshield
(24) Bring your mate breakfast in bed
(25) Drink a cappuccino at an outdoor café
(26) Read Shakespearean sonnets
(27) Go to an aquarium or zoo
(28) Take a carriage ride
(29) Play putt-putt golf
(30) Go dancing
(31) Go bowling
(32) Make bread together
(33) Cook a candle light dinner together
(34) Go kite flying
(35) Stay overnight in a bed and breakfast
(36) Rollerblade together
(37) Take a stroll in the rain
(38) Surprise your mate with a bouquet of balloons
(39) Take a walking tour of area attractions
(40) Swing on a porch
(41) Go bicycling together
(42) Leave each other love notes
(43) Swing in a hammock
(44) Sip hot chocolate w/ marshmallows by the fireplace
(45) Flirt with one another

Recommended Articles From My Blogroll

Today is a snow day for my wife and I in the Pacific Northwest and i'm able to catch up on some new article posts. Please enjoy the following articles/posts from authors on my blogroll.

Dual Income No Kids: "Bail out for Santa"




Budgets are Sexy: "Am i a Grandpa if i get my nephew a Savings Bond?" Good article about something of interest to myself. All of his recent posts are relatively interesting.

Master Your Card: "11 Reasons Why The Economy is Going to Get Worse Before it Gets Better"

Money for Military: "Get Your Free Credit Report to Start 2009"

Everyday Finance: "A Legitimate High Yield Stock you can Take to the Bank." The author writes about one of three stocks i'm investing in, Dow Chemical (DOW).

The Digerati Life: "Money Saving Ideas From The Ultimate Cheapskate's Road Map to Riches"

Save and Conquer: "401(k) Match Being Reduced or Eliminated" Article covers one area of the economic down turn.

Fiscal Zen: "Four Tools to Help You Make the Most of Ebay"

Miss Thrifty: "How to clean wallpaper - with bread"

Sticking to Basics Eases Financial Stress

Gregory Karp of the Chicago Times writes an easy to follow article titled "Sticking to Basics Eases Financial Stress." The article makes sense and integrates well with my own developing financial philosophy.

Karp cites a Synovate survey and emphasizes that people who follow three basic rules of money management are less stressed. The rules are:

* Have an emergency cash fund. Of those surveyed who did not have a six-month emergency fund, 90 percent felt stressed. This compares with 78 percent of all people surveyed feeling stressed. Finally, of those with a six-month emergency fund, only 56 percent felt stressed.

* Pay off credit cards in full

* Use a household budget. Similar results were found linking credit cards and household budgets to stress levels.

Karp's article can be found here. The remaining is my opinion...

Many people waste time focusing on exciting money making ventures and focus less on the simple things. Take for instance credit cards, people who carry a non o% APY credit card balance have no business investing in the stock market. Pay off your credit card.

The importance of a household budget varies depending on whether or not you are naturally frugal. I don't use a household budget at all. But, I'm an inherently frugal person. If you're prone to overspending, work on developing a manageable budget that focuses on saving for lifetime goals.

As for investing, focus on securing your future. Is your house or car paid off? If not, a majority of your free cash flow should go towards paying off these items. Are you or your spouse in an upwardly mobile career? If not, some of your free cash flow should be spent on career related education and training to make you competitive for higher wages and / or more satisfying work. Finally, speculative investments should take up no more than 20% of your free cash flow.

I will likely have people disagree with my 2009 household financial goals. In 2009 my household does not plan on contributing to a ROTH IRA. Instead, we are focusing our extra cash flow to pay off one of our three investment properties within the next two years. We feel it is important to pay off our houses during a down economy. Our 6-8 year payoff plan is as follows:

* House 1 (1400 sq ft @ 5.875% 30 yr fixed): $50.6k in mortgage debt with an estimated payoff date in Dec 2010.

* House 2 (1900 sq ft @ 5.5% 15 yr fixed): $91k in mortgage debt with an estimated payoff date no later than Dec 2013.

* House 3 (3100 sq ft @ 5% 15 yr fixed): $151.5k in mortgage debt with an estimated payoff date no later than Dec 2016.

The primary reason for focusing on our mortgage debt is the fact that it's a sure thing and in this economy, good renters are not. The one thing that may complicate our house pay off goals is unforseen maintenance expenses. We remain open to selling any or all of our houses if we get the price we want. Otherwise, we'll continue to carry them and the remaining $293k in mortgage debt associated with them.

Despite my emphasis on paying off our houses, i'm still speculative in other areas. I'm investing all of my blog earnings in peer-to-peer lending site LendingClub.com. So far, i've invested $125 in blog earnings in a 11.43% net interest bearing loan portfolio diversified across five loans. One can establish a LendingClub account through the below ad.




I'm also investing $150 a month across three dividend reinvestment plans (DRIPS): Dow Chemical (DOW), 3M (MMM) and Exxon Mobil (XOM). I started all three of my DRIPS through Directinvesting.com and corresponding agent companies Bank of New York Mellon, Wells Fargo Bank and computershare.com, respectively.

Bernard "Bernie" Madoff Ponzi Scheme Victims (Including Estimated Victim Losses)

Below is an initial list of victims of the Bernard “Bernie” Madoff Ponzi scheme orchestrated at Bernard L. Madoff Investment Securities LLC. Initial list adapted from Wikipedia article and expanded to show a total of $32.7 billion in estimated losses. Individual losses noted before each item listed below. Variance may exist due to round off error and currency exchange rates used in calculations at time of posting.

Feel free to link to this post. It will be updated periodically as additional information comes forward.

(7.5 B) Fairfield Sentry Ltd, a hedge fund run by Walter Noel's Fairfield Greenwich Group (Note 1).

(3.5 B) Kingate Global Fund Ltd, a hedge fund run by Kingate Management Ltd (Note 1).

(3.3 B) Tremont Capital Management (Note 2)

(3.21 B) Banco Santander, ticker STD, (through its “Optimal Fund”) Note 1.

(1.8 B) Ascot Partners hedge fund. Source: Diana Henriques and Alex Berenson at NY Times

(~1.8 B or slightly less) J. Ezra Merkin, chairman of GMAC, and founder of Ascot Partners hedge fund (Note 1).

(1.4 B) Access International Advisors LLC and clients (through its "American Selection" fund, traded as "LUXALPHA SICAV"). Source: Saijel Kishan at Bloomberg. Also, the fund manager, Rene-Thierry Magon de la Villehuchet, was found dead this Tuesday after an apparent suicide (Chicago Tribune source).

(1.4 B) Fortis Bank Netherlands (Note 2).

(1.08 B) Union Bancaire Privee and clients. Source: Reuters

(~1 B or less) HSBC, ticker HBC (Note 1).

(0.935 B) Benbassat & Cie, Swiss private bank. Source: Daily Intel

(0.633 B) Natixis and clients. Source: Guerrera, Sender at Financial Times

(0.624 B) Royal Bank of Scotland, ticker RBS (Note 1).

(0.484 B) BNP Paribas (Note 1).

(0.042 B) Fairfield Connecticut public employees pension fund. Source: Hartford Courant

(0.41 B) BBVA, Spain’s second-largest bank (Note 1).

(0.4 B) Fix Asset Management (Note 1).

(0.36 B) Man Group and clients (Note 1).

(0.33 B) Reichmuth and Co’s Reichmuth Matterhorn fund (Note 1).

(0.302 B) Nomura Holdings and clients (Note 1).

(0.28 B) Maxam Capital Management (including Maxam Absolute Return Fund), run by Sandra Manzke; Manzke has stated that Maxam has been "wiped out" and will close as a result of the losses (Note 1).

(0.28 B) Pioneer Alternative Investments (Note 1).

(0.23 B) EIM Group (Note 1).

(3.3 B) Tremont Capital Management (Note 2)

(0.188 B) M&B Capital Partners. Source: Westbrook & Kishan at Bloomberg

(0.145 B) Carl Shapiro’s charitable foundation (Note 1).

(0.14 B) Axa (Note 1).

(0.137 B) Aozora Bank. Source: Reuters

(0.104 B) Unicredit. Source: Catan & Bryan-Low of WSJ

(0.1 B to 0.11 B) Yeshiva University. Source: Strom at NYT

(0.107 B) Dexia SA (Note 2).

(0.066 B) Nordea Bank AB (Note 2).

(0.05 B) Banque Bénédict Hentsch and clients (Note 1).

(0.05 B) Korea Life Insurance (Note 1).

(0.005 B) North Shore-Long Island Jewis Health System (Note 1).

(0.04 B) Royal Bank of Canada, ticker RY (Note 2).

(0.03 B) Mortimer Zuckerman Charity(Note 2).

(0.029 B) Avram and Carol Goldberg, former owners of the Stop & Shop supermarket chain. Source: Daily Intel

(0.021 B) Bramdean Alternatives hedge fund run by Nicola Horlick of London. Source: Ian King of The Times

(0.019 B) Madoff Family Foundation (Note 1).

(0.018 B) Jewish Community Foundation of Los Angeles. Source: Daily Intel

(0.014 B) Groupama (Note 2).

(0.014 B) Harel Insurance Investments and Financial Services (Note 1).

(~0.014 B, or less) Societe Generale (Note 1).

(0.012 B) Massachusetts state pension. Source: Healy & Syre at Boston Globe

(0.012 B) Phoenix Holdings (Note 2).

(0.011 B) Banco Popolare. Source: Catan & Bryan-Low of WSJ

(0.011 B) Richard Spring of Boca Raton, FL. Source: Urbina at NYT

(0.01 B) Jewish Federation of Greater Washington. Source: Strom at NYT

(0.009 B) Korea Teachers' Pension (Note 1).

(0.008 B) Robert I. Lappin Charitable Foundation (Salem, Massachusetts) Charity founded by New Jersey Senator Frank Lautenberg (Note 1).

(0.007 B) Technion (Note 2).

(0.006 B) Julian J. Levitt Foundation, Texas (Note 1).

(0.006 B) The Ramaz School. Source: Strom at NYT

(~ 0.005 B, or less) NPB Neue Privat Bank (Zurich) and clients (Note 1).

(0.004 B) The SAR Academy, a Jewish School. Source: Strom at NYT

(0.004) CNP Assurances (Note 2).

(0.001 B) Clal Insurance (Note 2).

(~ 0.001 B) Mediobanca (Note 2).

TOTAL: $32.698 B

** Below is a listing of others mentioned online or on TV to have losses but without losses disclosed. Inclusion of some individuals below in the above total should be carefully done since in some cases the losses may be from "client" interests in one of the above.**

(1.) The Chais Family Foundation, Encino, CA.

(2.) Elise Wiesal Foundation for Humanity, losses unconfirmed

(3.) Joyce Greenberg and family, losses in multi-millions. Source: CNBC, 16 Dec

(4.) Notz, Stucki & Cie – undetermined (Note 1).

(5.) Lombard Odier Darier Hentsch & Cie

(6.) Palm Beach Country Club

(7.) Sterling Equities, Inc. led by New York Mets co-owner Fred Wilpon

(8.) Judy and Fred Wilpon Family Foundation

(9.) Stephen Spielberg’s charity, the Wunderkinder Foundation

(10.) Stephen Abbott (San Francisco lawyer) and family, hundreds of thousands. Source: Ross at San Francisco Chronicle

(11.) Norman Braman, former owner of the Philadelphia Eagles football team

(12.) Englebardt family of Los Angeles and elsewhere

(13.) Leonard Feinstein, co-founder of Bed Bath & Beyond Inc.

(14.) Stephen A. Fine, president of Biltrite Corp.

(15.) Jerome Fisher, founder of Nine West

(16.) Helfman family of Miami and elsewhere

(17.) Robert Jaffe and family (see also father-in-law Carl & Ruth Shapiro) of Palm Beach and elsewhere

(18.) Saul Katz, co-owner of the New York Mets

(19.) Irwin Kellner, chief economist for Marketwatch.com, of Port Washington, N.Y.

(20.) Susan Leavitt of Tampa Bay, Florida

(21.) Loeb family

(22.) Ira Rennert (billionaire), mentioned by Vicky Ward of Vanity Fair on CNBC on December 12, 2008 as being "heavily, heavily invested" with Madoff Ira Roth and family of New Jersey

(23.) Vincent Tchenguiz, UK real estate investor

(24.) Thyssen Family (including Thybo International fund)

(25.) Lawrence Velvel, dean of the Massachusetts School of Law

(26.) JEHTFoundation

(27.) Leonard Litwin

(28.) Mirabaud & Cie

(29.) Swiss bank Syz SA

(30.) Frontbridge

(31.) Lombard Odier

(32.) Gabriel Capital Partners' Ascot Fund Ltd.

Note 1: Jamie Dunkley at Telegraph.co.uk
Note 2: Westbrook & Kishan at Bloomberg

Lending Club: What I'm Using for my Loan Porfolio Performance Benchmark

I've blogged extensively about Prosper peer-2-peer lending in 2006 and have learned a lot from my experiences with the lending site. With Prosper in its quiet period, I have already funded four loans with LendingClub. My first impression with LendingClub was tainted by my unfamiliarity with it. Prosper has a far better search mechanism and better presentation of listings, but i'm beginning to think that this is all the PROS associated with Prosper. I'm beginning to warm up to LendingClub.

I'm using LendingClub to reinvest earnings from my blog. Later this week, I will roll another $25 of blog earnings into LendingClub. At Prosper, my loan portfolio has had horrible performance. According to LendingStats, only 73% of my loans are / were performing loans and my estimated ROI is 6.4%. At such a low rate, I might have been better off just paying off my highest interest rate mortgage (5.875%) and reinvesting my previously used Prosper Loan searching / funding time in some other area.

I must admit, I was pretty aggressive with Prosper lending. At sometimes, I was down right careless. Since 2007, I have regrouped into a more conservative lending style. I'm now implementing my more conservative lending strategy from scratch at LendingClub. I believe I will do better at this site. My initial two reasons to believe this reside in the fact that I can minimize risk at LendingClub by risking only $25 per loan vice the Prosper minimum of $50. Also, it appears that the LendingClub's vetting of applicants is better than at Prosper's site.

Now to the point referenced in the subject line... I was reviewing CNBC and found a great story about Capital One delinquency rates (article). LendingClub lenders should keep their eyes and ears open to all credit card company news on delinquency / write-off rates. At Capital One, the company is reporting a write-off percentage rate of 6.98% and a 30 day delinquent rate of 4.7%. At first, one might say it makes great sense to use these numbers as a yard stick to measure their own LendingClub account performance. Don't rely on this early on. Wait until your loan portfolio matures before you start measuring up to this.

I plan on using the Capital One write-off rate as a yard stick going forward. If I don't beat Capital One after one year at lending, i'll likely quit. My next goal after beating Capital One will be to have a net return of 8.4%. We'll see how things work out.

You can use the button below if you want to set up an account at LendingClub and test your lending skills.

U.S. Household Debt Drops For The First Time Ever

The Federal Reserve announced on Thursday that household debt decreased for the first time since the Fed started keeping this data over 50 years ago. For the period of July - September, households reduced their debt by an annual rate of 0.8 percent.

The Associated press reports:

"The decline in household debt levels is evidence of the severe credit squeeze that is occurring as banks, saddled by billions of dollars of losses in mortgage debt, have tightened lending standards and made it harder for people to get loans."

"Mortgage debt fell at an annual rate of 2.4 percent in the third quarter, the largest decline on record."

Additional details can be found the Associated Press article here.

GMAC Fails to Meet Conditions to Convert to Bank

I would be very skeptical of keeping any money in a GMAC bank account over FDIC insured limits. Check out this article from Bloomberg.

"By Ari Levy
Dec. 10 (Bloomberg) -- GMAC LLC, the auto and consumer lender seeking federal aid, failed to obtain enough capital to become a bank holding company and may abandon the effort, casting new doubt on the company’s ability to survive.

A debt exchange by GMAC and its Residential Capital mortgage unit designed to bolster the company’s finances didn’t attract enough participation, GMAC said today in a statement. So far, GMAC remains short of assembling $30 billion in regulatory capital that Federal Reserve requires, and the regulator has said the conversion won’t be approved if the requirement isn’t met.

GMAC has pinned its hopes for recovery on its plan to become a bank holding company and gain access to federal rescue programs. The Detroit-based company gave debt holders another three days to consider its exchange offer, adding that if it doesn’t complete the swaps and win Fed approval by Dec. 31, “it would have a near-term material adverse effect on GMAC’s business, results of operations, and financial position.”

Less than 25 percent of GMAC and ResCap’s existing debt covered by the exchange offer has been tendered, the statement said. GMAC needs about 75 percent participation for the plan to work, the statement said.